IoT and its role in transforming the business model
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Technology is changing at a rapid pace, but one of the greatest catalysts for the change is the Internet of Things (IoT), which works to connect all sorts of devices around the world. In this article, tech writer Rick Delgado presents the three main ways the IoT is transforming the traditional business model.
The IoT is already seen in everything from smart devices to manufacturing, and it is pushing full force into the business world. The IoT is revolutionizing how companies do business; here are three main ways the IoT is transforming the traditional business model.
Vast amounts of data available
The IoT can make a fundamental difference within an organization, but it can also be an overwhelming proposition to integrate it into a company. First and foremost is the vast amount of data available from the IoT, ranging from polls and surveys to buying trends and remote video surveillance footage. Having access to such copious amounts of data can be incredibly beneficial to a company; the issue now becomes how to sort through the data to analyze it properly and find the most relevant pieces of information.
The IoT opens to door to all sorts of data that can take your business model to the next level, including more insights into your customers and their purchasing patterns, your production operations, and even what your competitors are up to and what is driving their success. In order to truly take advantage of and integrate the IoT into your strategy, you need to choose the most relevant data and let it influence your strategy. It’s one thing to know the data is there, it’s another thing to actually put it to use to drive strategy and increase revenue.
Smarter products and equipment change thinking
After deciphering the most relevant information, companies in tune with the IoT use that information to change their thinking through smarter products and a stronger strategy. The data that comes out of the IoT might be surprising, but it can lead your company in new and successful directions. John Deere, for example, used data from the IoT to switch its mindset from being a tractor manufacturer to being a provider of soil quality.
The IoT thrives on data, so the most effective companies look for ways to get more data out of their products and find ways to connect their services back to the IoT. John Deere did this by placing more sensors on its machinery to learn about the land and its customers. Other companies can do this by integrating smart, mobile technology into their offerings and looking for ways to push their business and change their mindset by creating more data.
Cross-functional learning labs
More data available means the siloed walls many organizations currently have can come down. The IoT connects everything, including the work environment, meaning that to fully realize the potential of the IoT, employees should be communicating and working together across department lines. Collaboration is what really sets organizations apart, and groups that fail to truly collaborate will be left behind as the workplace changes in the future. Many executives think this is taking place to some extent, but most are surprised to find just how little actual cross-functional collaboration is occurring in their companies. To truly break down the walls, organizations need to put in use IT infrastructure that connects different data sources and uses that information to drive the company forward.
One of the most popular and most effective ways to do this is through innovation or learning labs, which are cross-functional collaboration areas where people from different departments and groups can gather to work together and access a wide range of IoT data. Each person brings their own perspective and expertise to create future-proof business models that meet the needs of each department and the overall goals of the company. With those business models in mind, each representative can then go back to his or her respective area to put it into action, all while continuing to work technologically with the rest of the cross-functional team.
The Internet of Things will undoubtedly change how we do business and interact with customers. When integrated fully into a business, it can transform the business model and prepare companies for the future.